Put in the hands of customers, CRM data is a powerful selling tool. To get good data, however, transparency is key. The more forthcoming retailers are about why they collect data, and their willingness to share it with customers, the more likely customers are to willingly share personal information. Allowing customers to "see what they have on me" is critical to building the trust that unleashes the willingness to share deeper and more articulated personal data. For example, when Amazon allows users to edit their purchase history, letting them weed out gifts for others that skew their personal recommendations, the company reveals some of the backend about how they are using the data they are collecting.
Giving the data back to the customers is just the first step, however. The next is to show customers what they can do with it. This can be in the form of tools like recommendations engines that help customers better find what they are looking for. The online music site Last.fm, recently purchased by CBS, has a great model for this. They ask users to download software that will report on all the music they listen to on their computer or iPod, when they listen to it, in what order, etc. In exchange for this personal data, Last.fm generates powerful recommendations that music users may like, and helps customers sort through the oceans of new music that are out there. It also places the user within a community of like-minded people, people who listen to the same kind of music, and therefore provide yet another incentive for sharing data. Netflix customers also voluntarily contribute a lot of rich preference information that allows Netflix's recommendations engine to serve up suggestions that show customers the relationships between what they liked and what they might like.
Media retailers, who have more in common with purely on-line experiences like myspace and facebook, already get that personal information is the stuff of identity that makes up the "clothes" that people "wear" when they meet the world. Because media preferences are so driven by taste, it's easier for media retailers to take the lead in this area. Matters of taste are closely related to personal data, so media customers wear their book, music, movie and game preferences like a badge reflecting aspects of their personality.
Retailers selling more utilitarian goods are also selling the stuff of personal and social identity, however, and they should take their cues from the inroads that media retailers are making.
If apparel retailers harvest more data on your wardrobe -- what you have bought from them and what you like -- and combine that with thorough body measurement information, they can develop recommendations systems similar to media retailers that can suggest clothes that go with what you have, and best complement your body type. Customers should be able to keep this data in a "What's in My Closet" profile that shows them graphically what they have bought, and give simple ratings to them, a la Netflix. These recommendations could be used on-line, in simple visualizations that help customers imagine how new clothing purchases would work together, and in store, for both customer- and associate-driven interactions.
Home Depot's Eco Options currently provides a tool to help customers green their homes, with no personal data collected. But with a portfolio of all the appliances you currently have in your home, Home Depot could proactively recommend new products and strategies that can help customers keep their homes green. Electronics retailers Best Buy and Circuit City provide product finders to help users get the products they need based on what they currently have in the home. But by keeping an ongoing record of all the consumer electronics equipment a customer has, retailers could remind them about upgrades, recommend expansions based on new technology, and even use predictive models based on customer behavior to anticipate what they might want to buy next. Pharmacies like Duane Reade automatically call you when your next prescription is due. But by keeping an on-going record of all of a customer's prescriptions and some knowledge of their underlying health issues, pharmacies could send information about generics, or updates on new medical information, or advisories on lifestyle practices likely to keep them healthier.
All of this can be done right now. All retailers need to do is unlock their CRM data box and let their customers share in the value.
About the Author
Gideon D'Arcangelo has been designing and producing interactive media experiences with ESI Design since 1995. Recent projects include Time Warner's "Home to the Future" installation and new concept stores for Best Buy. Prior to ESI, Gideon worked with Alan Lomax on the groundbreaking "Global Jukebox" audio-visual knowledge base. He currently teaches at NYU's graduate Interactive Telecommunications Program and is the series producer of "Listening In" on American Public Media's "Weekend America." He also occasionally produces pieces on music and technology for the popular radio programs "Marketplace" and "Studio 360."